How to Make a College Budget?
Do you also complaint about empty pockets and empty bags after 10th of each month! If so please read this out.
What is a Budget?
Budgeting is the first step in financial planning but most of us skip this step and still want to cover our expenses and have some savings.
- Planning for Expenses: In our day-to-day life we know about most of our future expenses on the basis of our previous experiences, like tuition fees, hostel-accommodation charges and food expenses. In a budget one can allocate income to each of the expenses that have to be fulfilled. If you have enough money to buy every thing you need without too much pondering does not mean that you do not need to plan. Planning is important because with planning you know where you are spending your money and whether you are spending your money on the things which you really need or not.
- Planning for Savings: Apart from regular expenses there can occur an emergency need to be fulfilled, though we do not know about the nature of emergency, nor about the amount of money we will need for it but we can at least allocate some money to savings in order to fulfill emergent needs. Needs like purchasing dress for friend's engagement or medication for any disease can be unexpected and if you do not have enough savings you will feel frustrated.
- Planning for Repaying Debts: People who do not make budgets are more likely to have more debts. In a budget you can plan to repay debts. With budgeting whether the future income is more than your expenses or quite less you will naturally cut extra costs but will try to repay the debts. Without budget even if you have it in your mind that debts have to be paid, you will find it difficult to manage expenses, savings and debts.
Question # 1
Do you make college budget?
Question # 2
Do you act on the budget too?
Question # 3
Did you save money and expenses with budgeting?
Strategies for Making College Budget
College budget needs no extraordinary planning some simple calculation and you are done with in less than an hour. With few exceptional needs all college students need to have books, food, clothes and accommodation. A better budget is formulated if you classify your needs in prominent classes/categories and within each category write down each and every need. Its better if you allocate some extra money for miscellaneous needs in each category. This will help you if any unforecasted need appears.
- Determine your monetary resources for the month/semester/year for which you want to make budget. Its better to make budget for small period of time. Making a budget for a month is better than making it for a whole semester, since many emergent needs will appear if you plan for long time and one can not forecast these needs. Your income can come from various sources like from parents, siblings, your own part-time job or from so investment you have done in property, bank or in shares.
- Write down the basic necessities, comforts and luxuries for the period for which you are making budget. Necessities come first and we all know that college necessities include college fees, books, food and rent if you are using hostel accommodation. Comforts come next and comforts can include internet connection charges, mobile or phone bills or any furniture that you have planned to purchase in the budget period. Planning for luxuries can include money for chilling out with your friends, lunching in a fast food place or going to watch movies. Of course you will first allocate income to necessities, then to comforts and in the end to luxuries.
- Plan for any debts to repay. Debts can be paid in installments if too much to be paid in one budgeting period otherwise its better to pay them as soon as possible. If you do not have any debts you are a lucky one.
- Determine the amount you can save for short-term needs like unexpected doctor appointments and impulse shopping as well for long-term needs like buying a new laptop, ipad or mobile.
- Give your budget a final look as still there might be need for revision. There can be needs that you forget to cover or in other case you might have allocated money to some not so important needs.
- Stick to your budget!!!
Benefits of Making Budget for College Students
- Understanding your spending habits is the first and one of the most important benefit you gain from budgeting. Budget will let you know whether you are spending your money on important things like books and food or on impulse buying and too much chilling out. Money today has become a great reason for frustration among youth. Students who do not plan about their expenses often feel frustrated for lack of money to satisfy their needs. With budget you will know where you are spending and is it worthwhile to spend your money on these needs.
- Debts are not easy to repay they often trap you in great trouble. In present it feels good to get some money to buy a new dress for the upcoming party but when you have to pay back this amount you will have to manage similar amount by cutting costs which becomes difficult. With proper planning of your money you can safeguard yourself from any debt.
- It gives you peace of mind. You will keep yourself away from expenses more than your resources afford and can study with peace.
- Inappropriate use of money is decreased to the last limit. If you are spending money on smoking, drinking or eating junk food by budgeting you can think about your bad habits and can control it in a better manner.
- Unexpected needs can emerge at any time and sometime they are very important to fulfill. You can allocate some money each month or each semester for unseen needs in budget. If you do not have savings you have to go for debt.
- Achieving dreams become easier. As a student everyone wants to get excellent grades but what is the price we have to pay to have good grades. Healthy mind and body, good resource books, extra tuition classes and . Without budgeting we spend money too much on junk food, eating out, impulse buying and on other unnecessary and unhealthy needs. Now this pattern of living can not guarantee excellent grades. With budget you can allocate more money to buying books, eating healthy food and joining gym for maintaining healthy body. These ideas come to your mind when you start planning your income. If you do not plan income these ideas can still come but then you might say that yeah its good to go for exercise to gym but I can not afford it yet so next month but nest month never comes.
- You can communicate your expenses to your parents and they will know that you do not spend money on unnecessary things rather you actually need this much amount. They will give you money without any yes or no.
- Some time is also saved during the budgeting period as you have already planned for your expenses and you need not worry or think too much for which alternate to buy, in what quantity and from where.
- In reality your income does not increases but by planning it seems that now you have more money as unnecessary costs are reduced to the minimum.
- Good luck!
Secrets to Successful Budgeting
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